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If the liquidity is enough, 1) Short Bitcoin to the tune of several Billion dollars. 2) Do a 51% attack and essentially prove it's worthlessness. 3) Profit
by qroshan 7y ago
If the liquidity is enough,
1) Short Bitcoin to the tune of several Billion dollars.
2) Do a 51% attack and essentially prove it's worthlessness.
3) Profit
- perseusmandate 7y agoIf you have amassed enough hashpower to be able to do the 51% attack you have far more to gain economically from continuing to mine for the network than to somehow short it (impossible to find a counterparty for a transaction that large) and then have billions of dollars of hardware that is now worthless
- imtringued 7y agoAlso if multiple parties attempt to mount a 51% attack then they will have to compete with each other which makes the attack impossible.
- james-mcelwain 7y agoAre the sort of places willing to sell options on BTC the sort of places that would honor such a contract if the price went to 0?
- lonelappde 7y agoSuch is Bitcoin's continuing rediscovery of all of finance, now including the 2008 Global Financial Crisis.
- jotakami 7y agoContracts are established between market participants; the issuer is just a facilitator. LedgerX options are fully collateralized so you could certainly reap the entire value if you bought a put and the price dropped to 0. Liquidity is not very deep though, so you wouldn’t be able to buy much. Margined products (such as Deribit’s options) would probably be force-closed long before the price hit 0.
- james-mcelwain 7y agoI feel like LedgerX bragging that they are both an exchange and a clearing house does not inspire confidence in their risk management department, although I'm sure the bright minds at the SEC have done their due diligence as they always do.